Assurex Global Market Check Survey: Medical Plan Opt-Out Incentive Strategy

As annual enrollment nears, employers are revisiting their benefit packages to determine where revisions need to be made. Some employees may have the choice of enrolling in other medical coverage, whether that be through a spouse’s plan, an individual plan or other. While they may have additional plans to consider, the employee may not actually review those options. Employers can financially incent employees to waive coverage and enroll elsewhere or provide cash to those employees who do not need coverage.

We conducted a poll during a webcast on September 24 to determine what strategies are most prevalent today and the results are in the chart below.

While offering an incentive to employees to waive the group medical coverage may be appealing and provide financial savings, employers should also consider other areas such as how the incentive will be paid, whether it will count as wages or be taxable, who will be eligible to receive, and whether it will violate any nondiscrimination or Medicare Secondary Payer rules.

Based on 444 employer respondents; September 24, 2020